AT&T to Buy Nextel Mexico for $1.9B

AT&T makes another purchase in Mexico, adding Nextel Mexico to its Iusacell holdings to grow its customer base there.

Sarah Thomas, Director, Women in Comms

January 26, 2015

2 Min Read
AT&T to Buy Nextel Mexico for $1.9B

AT&T is expanding its reach south of the border once again, this time spending $1.875 billion to acquire Nextel Mexico from NII Holdings. It will merge the operator's customers with its recently acquired Iusacell customer base, creating what it calls the first ever North American Mobile Service area.

AT&T Inc. (NYSE: T) announced the acquisition early Monday, noting that it would pay Nextel Mexico owner NII Holdings Inc. (Nasdaq: NIHD) $1.875 billion, less the outstanding net debt of the business at closing for all the companies that operate under the name Nextel Mexico and all of NII's wireless properties in Mexico, including spectrum licenses, network assets, retail stores and around 3 million subscribers.

The acquisition is expected to close in mid-2015 subject to regulatory review in Mexico and bankruptcy auction and approvals for NII in New York as the company filed for bankruptcy in the US in September. It comes just one week after AT&T closed its acquisition of fellow Mexican wireless operator Iusacell for $2.5 billion. (See AT&T Names Iusacell CEO, Closes Acquisition and AT&T to Buy Iusacell, Plans Lower Capex For 2015.)

For more on M&A in the mobile industry, peruse the dedicated mobile content channel here on Light Reading.

AT&T has its sights set on becoming a cross-border operator, and spending over $4 billion on Iusacell and Nextel Mexico is clearly a big strategic step in that direction. The carrier says Nextel Mexico's iDEN network covers around 76 million people, which it plans to combine with Iusacell's 8.6 million 3G HSPA+ customers, reaching 70% of the Mexican population -- albeit with different network technologies.

AT&T pledges to extend service outside of major metropolitan areas as part of its goal to create "the first-ever North American Mobile Service area covering over 400 million consumers and businesses in Mexico and the US."

Its customers in the US are already feeling the benefits of this reach as AT&T has launched unlimited calling to anywhere in Mexico. But its vendors might be feeling less positive effects of the acquisitions as well, as AT&T has had to lower its capital expenditure plans for 2015, partly as a result of its outlay of cash in Mexico. (See AT&T Dials Up Unlimited Calling to Mexico and AT&T's Mexican Capex Dance.)

AT&T is also waiting approval for its $48.5 billion acquisition of DirecTV Group Inc. (NYSE: DTV), which has operations in Mexico. (See AT&T: Merger Review Halt Won't Hurt Us and AT&T: We'll Bundle Fixed Wireless & DirecTV.)

— Sarah Thomas, Editorial Operations Director, Light Reading

About the Author(s)

Sarah Thomas

Director, Women in Comms

Sarah Thomas's love affair with communications began in 2003 when she bought her first cellphone, a pink RAZR, which she duly "bedazzled" with the help of superglue and her dad.

She joined the editorial staff at Light Reading in 2010 and has been covering mobile technologies ever since. Sarah got her start covering telecom in 2007 at Telephony, later Connected Planet, may it rest in peace. Her non-telecom work experience includes a brief foray into public relations at Fleishman-Hillard (her cussin' upset the clients) and a hodge-podge of internships, including spells at Ingram's (Kansas City's business magazine), American Spa magazine (where she was Chief Hot-Tub Correspondent), and the tweens' quiz bible, QuizFest, in NYC.

As Editorial Operations Director, a role she took on in January 2015, Sarah is responsible for the day-to-day management of the non-news content elements on Light Reading.

Sarah received her Bachelor's in Journalism from the University of Missouri-Columbia. She lives in Chicago with her 3DTV, her iPad and a drawer full of smartphone cords.

Away from the world of telecom journalism, Sarah likes to dabble in monster truck racing, becoming part of Team Bigfoot in 2009.

Subscribe and receive the latest news from the industry.
Join 62,000+ members. Yes it's completely free.

You May Also Like